The Security Exchange Board of India (“Board”) has in a recent notification dated 6th December, 2018 amended the Securities and Exchange Board of India (Mutual Funds) Regulations, 1996 (“Principal Regulation”) and notified the Securities and Exchange Board of India (Mutual Funds) (Third Amendment) Regulations, 2018.
The Board has inserted a proviso to sub regulation 3 of Regulation 7B of the Principal Regulation. It says that in the event of a merger, acquisition, scheme of arrangement or any other arrangement involving the sponsors of the mutual funds, shareholders of the asset management companies or trustee companies, their associates or group companies which results in the incidental acquisition of shares, voting rights or representation on the board of the asset management companies or trustee companies, Regulation 7B relating to norms of shareholding and governance in mutual funds needs to be complied with within a period of one year of coming into force of such an arrangement.
Source: Security Exchange Board of India
